DORCHESTER MINERALS, L.P.

Description of the Business

Dorchester Minerals, L.P. (the “Partnership”) is a publicly traded Delaware limited partnership that commenced operations on* January 31, 2003.Our business may*be described as the acquisition, ownership and administration of Royalty Properties (which consist of producing and nonproducing mineral, royalty, overriding royalty, net profits, and leasehold interests located in 594 counties and parishes in 28 states (“Royalty Properties”)) and net profits overriding royalty interests (referred to as the Net Profits Interest, or “NPI”).

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Partnership have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The unaudited condensed consolidated financial statements donot include all of the disclosures required for complete annual financial statements prepared in conformity with U.S. GAAP. Therefore, the accompanying unaudited condensed consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Partnership’s Annual Report. The accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal and recurring adjustments unless indicated otherwise) that are, in the opinion of management, necessary for the fair presentation of our financial position and operating results for the interim period. Interim period results arenot necessarily indicative of the results for the calendar year. Per unit information is calculated by dividing the income or loss applicable to holders of the Partnership’s common units by the weighted average number of units outstanding. The Partnership hasno potentially dilutive securities and, consequently, basic and diluted income per unit donot differ.

The unaudited condensed consolidated financial statements include the accounts of the Partnership and its wholly-owned subsidiaries Dorchester Minerals Oklahoma LP, Dorchester Minerals Oklahoma GP, Inc., Maecenas Minerals LLP, Dorchester-Maecenas GP LLC, The Buffalo Co., A Limited Partnership, DMLPTBC GP LLC, and DMLP Terra Firma LLC. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Partnership evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Partnership considers reasonable in each circumstance. Any effects on the Partnership’s business, financial position, or results of operations resulting from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. Although the Partnership believes these estimates are reasonable, actual results could differ from those estimates.

Recent Accounting Pronouncements

Recently Adopted Pronouncements

In* November 2023,the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)2023-07, “Segment Reporting (Topic280*): Improvements to Reportable Segment Disclosures” (“ASU2023-07”), which expands a public entity’s annual and interim disclosure requirements about their reportable segments, primarily through more detailed disclosures about significant segment expenses. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU2023-07, as well as all existing segment disclosures in ASC280 on an interim and annual basis. ASU2023-07 is effective for annual periods beginning after* December 15, 2023,and for interim periods beginning after December**15,* 2024. We adopted this standard for our fiscal year2024 annual consolidated financial statements and interim condensed consolidated financial statements thereafter and have applied this standard retrospectively for all prior periods presented in the consolidated financial statements. See Note6 — Segment Reporting for further information.

Accounting PronouncementsNot* Yet Adopted*

In* November 2024,the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic220*-40): Disaggregation of Income Statement Expenses” (“ASU2024-03”), which requires public entities to disclose additional information about certain costs and expenses included in relevant expense captions presented on the income statement. ASU2024-03 is effective for annual periods beginning after* December15,* 2026, and for interim periods within annual reporting periods beginning after* December15,* 2027, with early adoption permitted. Management is currently evaluating ASU2024-03 to determine its impact on the Partnership’s disclosures.

The Partnership considers the applicability and impact of all ASUs. There areno other recent accounting pronouncementsnot yet adopted that are expected to have a material effect on the Partnership upon adoption.

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On* September 30, 2024,pursuant to a non-taxable contribution and exchange agreement with West Texas Minerals LLC, a Delaware limited liability company, Carrollton Mineral Partners, LP, a Texas limited partnership, Carrollton Mineral Partners Fund II, LP, a Texas limited partnership, Carrollton Mineral Partners III, LP, a Texas limited partnership, Carrollton Mineral Partners III-B, LP, a Texas limited partnership, Carrollton Mineral Partners IV, LP, a Texas limited partnership, CMP Permian, LP, a Texas limited partnership, CMP Glasscock, LP, a Texas limited partnership, and Carrollton Royalty, LP, a Texas limited partnership (collectively, the “Contributors”), the Partnership acquired mineral, royalty, and overriding royalty interests in producing and non-producing oil and natural gas properties representing approximately 14,225 net mineral acres located in 14 counties across New Mexico and Texas in exchange for 6,721,144 common units representing limited partnership interests in the Partnership valued at $202.6 million and issued pursuant to the Partnership’s registration statements on Form S-4. We believe that the acquisition is considered complementary to our business. The transaction was accounted for as an acquisition of assets under U.S. GAAP. Accordingly, the cost of the acquisition was allocated on a relative fair value basis and transaction costs were capitalized as a component of the cost of the assets acquired. The condensed consolidated balance sheet as of December**31,* 2024 includes $193.7 million of net proved oil and natural gas properties acquired in the transaction. Final settlement net cash received, net of capitalized transaction costs paid, of $1.9 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for thethree months ended* March 31, 2025.*

On* September 30, 2024,pursuant to a non-taxable contribution and exchange agreement with an unrelatedthird* party, the Partnership acquired royalty interests totaling approximately 1,204 net royalty acres located in Weld County, Colorado in exchange for 530,000 common units representing limited partnership interests in the Partnership valued at $16.0 million and issued pursuant to the Partnership’s registration statement on Form S-4. We believe that the acquisition is considered complementary to our business. The transaction was accounted for as an acquisition of assets under U.S. GAAP. Accordingly, the cost of the acquisition was allocated on a relative fair value basis and transaction costs were capitalized as a component of the cost of the assets acquired. The condensed consolidated balance sheet as of* December**31,* 2024 includes $14.6 million of net proved oil and natural gas properties acquired in the transaction.

On* March28,* 2024, pursuant to a non-taxable contribution and exchange agreement with multiple unrelatedthird parties, the Partnership acquired mineral interests totaling approximately 1,485 net royalty acres located intwo counties in Colorado in exchange for 505,369 common units representing limited partnership interests in the Partnership valued at $17.0 million and issued pursuant to the Partnership’s registration statement on Form S-4. We believe that the acquisition is considered complementary to our business. The transaction was accounted for as an acquisition of assets under U.S. GAAP. Accordingly, the cost of the acquisition was allocated on a relative fair value basis and transaction costs were capitalized as a component of the cost of the assets acquired. At closing, in addition to conveying mineral interests to the Partnership, the contributors delivered funds to the Partnership in an amount equal to their cash receipts during the period from* January 1, 2024through March 25, 2024of $4.0 million. The contributed cash of$4.0 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for thethree* months ended* March 31, 2024.The condensed consolidated balance sheet as of December31,* 2024 includes $12.3 million of net proved oil and natural gas properties acquired in the transaction.

Our Partnership and Dorchester Minerals Operating LP, a Delaware limited partnership owned directly and indirectly by our General Partner, are involved in legal and/or administrative proceedings arising in the ordinary course of their businesses,none of which have predictable outcomes andnone of which are believed to have any significant effect on consolidated financial position, cash flows, or operating results.

On* April24,* 2025, the Partnership announced its cash distribution for thefirst quarter of2025 of $0.725835 per common unit, representing activity for thethree-month period ended* March31,* 2025, payable to common unitholders of record as of* May5,* 2025. This distribution will be paid on* May15,* 2025. The partnership agreement requires the next cash distribution to be paid by* August**14,* 2025.

The Partnership manages its business activities on a consolidated basis and operates in asingle operating and reportable segment. Operating segments are defined as components of a public entity that engages in business activities and for which discrete financial information and operating results are available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and assess performance. As disclosed in Note1 – Business and Basis of Presentation, our business* maybe described as the acquisition, ownership and administration of Royalty Properties and the NPI. See Note2* – Summary of Significant Accounting Policies in the Partnership’s Annual Report for a summarization of the Partnerships revenue recognition policy.

The Partnership’s Chief Executive Officer (“CEO”) has been determined to be the chief operating decision maker of the Partnership. The CEO uses Net income, as reported on our Condensed Consolidated Income Statements, to assess financial performance and allocate resources on a consolidated basis. The CEO manages and evaluates the results of the Partnership on a consolidated basis, and Net income is used to evaluate key operating decisions, such as making strategic acquisitions, determining transaction structures to capitalize on the development of the properties underlying our mineral interests, and allocating resources for general and administrative expenditures. The CEO doesnot review condensed consolidated balance sheet assets when assessing segment performance and deciding how to allocate resources. Disaggregated operating revenues of the Partnership’s single segment and all significant segment expenses are presented separately on the Partnership’s Condensed Consolidated Income Statements. There areno other significant segment expenses or other segment items that would require disclosure.

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